National economic activity across the U.S. continued to expand at a "modest to moderate" pace with many districts noting an "increase in uncertainty" due to the government shutdown and debt ceiling debate, the Federal Reserve reported on Wednesday.
The Fed's Beige Book noted that reports from the twelve Federal Reserve Districts suggest that "national economic activity continued to expand at a modest to moderate pace" during the reporting period of September through early October. It added that "contacts across Districts generally remained cautiously optimistic in their outlook for future economic activity, although many also noted an increase in uncertainty due largely to the federal government shutdown and debt ceiling debate." Consumer spending continued to increase and activity in the travel and tourism sector expanded in most Districts, whereas financial conditions were "little changed on balance," and price and wage pressures were again "limited." The Beige Book noted that employment growth remained "modest" in September. Several Districts reported that "contacts were cautious to expand payrolls, citing uncertainty surrounding the implementation of the Affordable Care Act and fiscal policy more generally."